Lyra Therapeutics Inc., coming off a growth year following an infusion of venture capital, recently hired its first full-time, in-house finance chief -- a sign of maturity as the company's lead medical treatment inches closer to commercialization.

Watertown, Mass.-based Lyra appointed R. Don Elsey as finance chief to help lead the biotechnology company as it goes through rounds of clinical trials for a chronic sinusitis treatment it is developing.

The move to hire a permanent finance chief follows a period during which Lyra employed a string of part-time, contracted finance executives, some outsourced from finance support and CFO services firm Danforth Advisors LLC.

Young, private companies frequently turn to rent-a-CFOs for technical expertise, executive recruiters say. Companies generally outgrow interim and part-time CFOs when revenue exceeds $40 million or, if not yet public, they have a two-year horizon for an initial public offering, said Jenna Fisher, global head of the CFO practice at executive recruiting firms Russell Reynolds Associates.

Hiring a full-time CFO can be a signal of stability and perhaps a sign that a company is ready to take on a new chapter.

"A direct hire on a permanent basis is someone truly entrenched in the organization," said Paul McDonald, a senior executive director at staffing firm Robert Half International Inc., adding that a full-time hire isn't necessarily cheaper than interim ones.

Mr. Elsey has experience taking companies public. He was most recently CFO of Germantown, Md.-based medical technology company Senseonics Holdings Inc., which he took public in 2016. He also helped guide the 2006 IPO of Rockville, Md.-based biopharmaceutical company Emergent BioSolutions Inc., where he was also CFO.

"For biotech companies, going public is often a path that is chosen, but we don't have a timeline," Mr. Elsey said of Lyra's plans. "Nothing is propelling us to an IPO at this point."

At Lyra, Mr. Elsey will be tasked with managing costs throughout the clinical trial process -- always a delicate balance in biotechnology, which requires investment in research and development, the risk of potential failure, and the testing of investors' patience.

He'll also play a key role in raising more capital, said Maria Palasis, Lyra's chief executive. The company's venture-capital funding totals about $35.5 million, including a roughly $30 million Series B round in September 2018, a spokesperson said. Lyra's investors include Perceptive Advisors LLC, Intersouth Partners and North Bridge Venture Partners.

Lyra's staff has increased from 20 to 30 people since the Series B funding. The company is expected to reach as many as 40 by the end of this year, Mr. Elsey said. He said he'll seek to increase the company's efficiency without doing extensive hiring or acquiring or leasing real estate.

"We've found some interesting cloud-based apps that can simplify the accounting and make it more efficient without growing the finance staff," Mr. Elsey said.

Lyra's first treatment for ear, nose and throat (ENT) diseases, which entered the Stage 2 trial in the spring, is placed deep in the nasal passages during a doctor's office visit and releases an anti-inflammatory drug. Phase 3 of the trial is expected to occur in 2021, Mr. Elsey said.

The timing of a market release varies widely, based on the number of patients needed for the trial and the Food and Drug Administration approval, among other factors.

The market for ENT treatments has room for startups attempting to treat chronic sinusitis, analysts said.

There are only a handful of companies focused on treating ear, nose and throat conditions, such as Intersect ENT Inc., based in Menlo Park, Calif., and OptiNose Inc., based in Yardley, Pa.

Some analysts said Lyra could face challenges because its treatment, a procedure that occurs alongside a nasal endoscopy at a doctor's office, could imply a potentially higher price point than a prescription drug patients can buy in a pharmacy.

Pricing can prove to be an obstacle to adoption for some treatments, analysts said. ENT specialists are proceduralists by training and therefore Lyra doesn't anticipate an issue with adoption, Ms. Palasis said.

"There are certainly some future milestones they'll have to check off before you have a better sense of whether pricing poses a challenge," said Kyle Rose, an analyst at investment bank Canaccord Genuity Group Inc. who follows Intersect ENT.

Lyra could benefit from venture capitalists' growing faith in small drugmakers. The median premoney valuation for venture-backed biotech startups that went public in the first half of the year was $339 million, the highest on record, according to a report from Silicon Valley Bank.

Biotech companies have been actively raising venture funding and going public. For example, the shares of three biotech companies listed on the Nasdaq Stock Market on the same day in June soared in their trading debut.

"There does appear to be an investor appetite for medical tech companies coming to the public sphere," said Ravi Misra, an analyst at broker-dealer Berenberg Capital Markets LLC who follows Intersect ENT. "Hiring a public-company guy is usually a signal."

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